- Bitcoin continues to trade in a tight range and few traders seem to expect a resolution to the upside.
- Next BTC mining difficulty adjustment is expected to be less negative than the previous one.
- The inflow of funds on cryptocurrency exchanges may increase volatility and suggest a bullish outlook.
Bitcoin price remained uneventful due to the lack of volatility on cryptocurrency exchanges. An inflow of funds used for gambling in the European Cup suggests a bullish outlook.
BTC inflow to exchange wallets points to dropping sell-side pressure
The total supply of BTC on exchanges has dropped from 319,500 to 145,100 tokens, representing a 54% decline observed in the past two days. This sum accounts for the total Bitcoin transferred to known exchange wallets from all sources like mining pools, independent miners, and large wallet holders.
A decline in the supply of Bitcoin on exchanges means the number of BTC tokens available to sell reduces. Therefore, the recent exchange activity might serve to ease the sell-side pressure behind Bitcoin and add fuel to the bullish outlook especially when considering the recovery in hashrate.
The processing power of the Bitcoin network has been slowly recovering over the past few days after going through the largest negative mining difficulty adjustment of -27.90% on July 3. Although analysts expected a more severe negative adjustment on July 17, it is estimated to be around -10.24%.
Past changes in mining difficulty have had an impact on Bitcoin price and large negative adjustments have led to price drops. However, the current estimates suggest further negative impact on price is less likely.
What’s interesting is that the mining difficulty adjustment is closely preceded by the end of a major sporting event, the Euro Cup 2020. An event of this scale captures the interest of soccer fans across the world, creating an exodus of market speculators.
Bitcoin could be the real winner of the Euro Cup
Bitcoin’s range-bound price action is linked to the lack of market catalysts and volatility. But the stagnation period seen recently might change as speculators and gamblers go back to crypto.
Now that the Euro Cup games have ended, Bitcoin held on betting platforms is likely to hit exchanges. This is primed to act as a liquidity creation event, increasing the inflow of Bitcoin and the number of active traders on cryptocurrency exchanges.
The end of Euro Cup 2020 coupled with the upcoming mining difficulty adjustment may become one of the main drivers for Bitcoin price. A higher number of active traders on cryptocurrency exchanges, may drive demand and strengthen the buy-side.
Colin Wu, a popular Chinese Journalist tweeted,
The European Cup is over, funds used for football gambling may return to cryptocurrencies, which may bring a short-term benefit.
— Wu Blockchain (@WuBlockchain) July 12, 2021
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